As a business owner, you’re constantly juggling several key responsibilities: keeping an eye on your bottom line, building your brand, monitoring your immediate competition, and making sure your customers are satisfied, just to name a few. In other words, you’ve got your hands full.
But the good news is that (all triteness aside), business owners like you and e are a massive part of the US economy. In fact, according to the U.S. Small Business Administration, “the 23 million small businesses in America account for 54% of all U.S. sales,” and “small businesses provide 55% of all jobs and 66% of all net new jobs since the 1970s.” Clearly, you and your growing business are exactly what this country needs more of.
However, despite the necessity of small businesses in the American economy, the harsh reality is that 1 out of every 4 (25 percent) will fail within the first year, and nearly 75 percent will fold within 10 years. And while there are almost as many reasons for these failures as there are businesses, one of the most common “self-sabotaging” practices is failure to harness the power of customer feedback.
You see, as a popular consumer review website with 1.3 million monthly users, we here at HighYa are afforded a unique perspective—a bird’s eye view, if you will—on the strategies that thousands of businesses use to sell their products and services. And regardless of whether or not these companies and their products ultimately succeed, we’re granted a front-row seat to the best and worst of marketing and promotion.
When it comes down to it though, here’s what we’ve found that separates good businesses from the great ones; businesses that flourish from those that quickly fade away: harnessing the power of negative feedback. So grab some popcorn, sit back and relax, and let’s take a look at how you can use customer reviews to create a flourishing business.
Looking to Create Your Purple Cow?
Many companies (perhaps even most) wisely spend their money on creating a remarkable product or service first, and then enjoying the resultant word-of-mouth marketing that their customers naturally provide. This is what Seth Godin calls a “Purple Cow.” However, although this avenue to success is certainly the most cost effective, it’s no secret that it takes an immense amount hard work to achieve.
Because of the inherent difficulty of producing a Purple Cow, our research, in addition to the thousands of reviews HighYa readers have contributed, has uncovered a massive number of businesses who do the exact opposite. Instead of creating a useful, high-quality product or service, these companies’ express intent is to mislead their customers and to trick them into making a purchase. This is what we here at HighYa like to call a “Yellow Pig.”
In other words, these companies’ business models center around one-time purchases (after all, if you receive an inferior product and poor customer service, will you purchase from the same company again?) instead of engendering repeat purchases. In order to circumvent this problem, it’s often the case that these companies quickly disappear, and then later reappear under a new name and product lineup, but with the same poor business model. And the process deliberately continues to repeat itself.
The Upside of the Yellow Pig
However, while the electronic nature of today’s retail market provides manufacturers with the opportunity to engage in deceit, it also gives customers the unprecedented ability to quickly and effectively spread the word about their experiences. In many instances, this can stop poor businesses in their tracks.
While this ability to spread information certainly helps put customers in the driver’s seat, it also offers an excellent opportunity for business owners like you to tune into what their customers are saying, digest the information, and then use it to improve your products as well as your customer service. In other words, the internet age makes it easier than ever to create your Purple Cow—but only if you’re looking at it from the right perspective.
Turning Negative Feedback into Positive Action
Hey, we’re all human, and none of us like to hear that our customers aren’t satisfied, especially if we’re made aware of their dissatisfaction through an online review. If we’re being honest, receiving a negative customer review can feel a little “raw” and intimidating, like someone airing your dirty laundry for all the world to see.
But the truth is that life is all about perspective, so how you choose to look at these negative reviews can make all the difference in how successful your business turns out to be. As such, instead of dreading negative reviews, why not view them as an opportunity to listen to your customers’ concerns, address the problems, and enter into an authentic conversation with them? After all, responding to a negative review shows that you genuinely care about your customers’ satisfaction, and it can ultimately be more impactful than a positive review.
Viewed with proper perspective and implemented correctly, consumer reviews, regardless of how strange their opinions or preferences may seem, can be an invaluable tool for growing your business. If you’re genuinely intent on building your Purple Cow, then you have nothing to fear from negative feedback. Instead, you’ll only gain credibility with your customers. After all, when it comes down to it, no company is perfect. But when you choose to embrace your imperfections and actively work with your customers to fix them, then you’ll be light years ahead of your competition.
Image credit: Financial Times, Flickr
Note: This post first appeared on LinkedIn Pulse.